"Every judge who has heard the case agrees that Microsoft engaged in illegal business practices," Lockyer said. "While the settlement proposals are a step forward, they fail to provide adequate remedies for Microsoft's illegal use of its monopoly power to crush innovative technology. We need strong remedies to curb future abuses by the software giant and to ensure a fair marketplace in which businesses can compete and grow to offer consumers more choices."

The federal district court in Washington, D.C., had given the states involved in the Microsoft antitrust case until Tuesday to decide whether to accept the proposed settlement agreed to by the U.S. Justice Department. California joined with Massachusetts, Iowa, Florida, Connecticut, Utah, Kansas, West Virginia, Minnesota, and the District of Columbia in rejecting or not immediately accepting the settlement plan. Lockyer said California, like many of the other states, remains open to settlement discussions with Microsoft.

"Integrated products are easier to use and are attractive to consumers, but they shouldn't be used to unfairly deny access to competitors who have better products to offer," Lockyer said. "Stronger remedies that open up competition would be in the best interest of California businesses and benefit California consumers by making more and better products available."